189. Based on the information in the following income statement and balance sheet for Monterey Corporation, determine the cash flows from operating activities using the direct method.
Monterey Corporation
Income Statement
For Year Ended December 31, 2015
Sales............................
$504,000
Cost of goods sold...................
327,600
Depreciation......................
42,000
Other operating expenses..............
125,500
(495,100
)
Other gains (losses):
Gain on sale of equipment............
7,200
Income before taxes.................
16,100
Income tax expense..................
(4,800
Net income.......................
$ 11,300
Balance Sheets
At December 31
2015
2014
Cash...........................
$64,650
$55,800
Accounts receivable................
21,000
29,000
Inventory.......................
58,000
52,100
Equipment......................
240,000
222,000
Accumulated depreciation............
(106,000
(96,000
Total assets.......................
$277,650
$262,900
Liabilities:
Accounts payable..................
$28,400
$23,700
Income taxes payable...............
1,050
1,200
Total liabilities....................
$29,450
$24,900
Equity:
Common stock....................
$106,000
Paid-in Capital in Excess of Par………...
18,000
Retained earnings..................
124,200
114,000
Total equity......................
$248,200
$238,000
Total liabilities and equity..............
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